Worldwide: Global Anti-Corruption Insights: Summer 2019

The US Department of Justice (DOJ) and US Securities and Exchange Commission (SEC) have announced over $1 billion in corporate settlements of Foreign Corrupt Practices Act (FCPA) matters so far this year. Most recently, the DOJ and SEC announced a $25 million settlement with Microsoft Corporation. In June, Walmart Inc. agreed to resolve the DOJ and SEC's long-running investigation for a total of $282 million, with the retention of an independent corporate compliance monitor for two years. Also in June, French oil and gas company TechnipFMC agreed to a coordinated settlement with the DOJ and Brazilian authorities for a total of $296 million, without the requirement of a monitor, despite being a repeat offender. Earlier in the year, the DOJ and SEC settled FCPA cases with Russia-based Mobile Telesystems Pjsc for a combined $850 million (with a monitor for three years) and with Germany-based Fresenius Medical Care for a combined $231 million (with a monitor for two years). The SEC has resolved FCPA enforcement actions against two other companies as well.

The DOJ also has pursued prosecutions of over a dozen individuals in cases related to enforcement of the FCPA this year. These include numerous prosecutions involving the alleged bribery of officials at state oil companies in Latin America. While these matters highlight continued corruption risks in the oil and gas industry and in Latin America generally, the DOJ's criminal enforcement record this year spans a variety of industries, such as banking, telecommunications, technology, and medical devices, and across continents from Asia to Europe to Africa.

The SEC, for its part, has resolved FCPA charges against two individuals in the technology services sector. And, in an example of another federal agency taking enforcement action with respect to foreign corruption, on February 21, 2019, the Federal Reserve Board announced that it had permanently barred a former investment banker from the banking industry for having "improperly administered a referral hiring program at [his former employer] by offering internships and other employment opportunities to individuals referred by foreign officials, clients, and prospective clients in order to obtain improper business advantages for the firm."


On April 30, 2019, the DOJ Criminal Division published new guidance titled Evaluation of Corporate Compliance Programs. The new guidance "is meant to assist prosecutors in making informed decisions as to whether, and to what extent, the corporation's compliance program was effective at the time of the offense, and is effective at the time of a charging decision or resolution, for purposes of determining the appropriate (1) form of any resolution or prosecution; (2) monetary penalty, if any; and (3) compliance obligations contained in any corporate criminal resolution (e.g., monitorship or reporting obligations)." The document organizes 12 topics under the three "fundamental questions" about compliance program effectiveness listed in Section 9-28.000 of the Justice Manual:

  • Is the program well designed?
  • Is the program being implemented effectively?
  • Does the compliance program work in practice?

For more analysis, see our prior Advisory, DOJ Issues New Guidance on Evaluating the Effectiveness of Compliance Programs, as well as our recent webinar, (How) Should You Change Your Company's Compliance Program(s) in Response to the DOJ's Recent Guidance?

On March 6, 2019, the Commodity Futures Trading Commission (CFTC) Division of Enforcement announced the opening of a new front in the US government's battle against overseas bribery with an Enforcement Advisory on self-reporting and cooperation with respect to violations of the Commodity Exchange Act (CEA). In related remarks, the CFTC's Enforcement Director James McDonald declared that the CFTC has multiple open investigations into alleged foreign bribery and stated that "foreign corrupt practices," including bribery, "might constitute fraud, manipulation, false reporting, or a number of other types of violations under the CEA, and thus be subject to enforcement actions brought by the CFTC." The CFTC's legal authority to pursue such enforcement actions has not yet been tested, and, to date, the CFTC has not brought any formal charges under the CEA based on allegations of foreign corrupt practices.


There is no private right of action under the FCPA, but companies implicated in FCPA violations nevertheless often face costly collateral civil litigation. For example, on February 26, 2019, the US Court of Appeals for the Ninth Circuit affirmed most of an $11 million jury award obtained by the former General Counsel of Bio-Rad Laboratories, Inc. (Bio-Rad). The former in-house lawyer had claimed that Bio-Rad wrongfully terminated him after reporting concerns about foreign bribery. Although the Ninth Circuit found issues with the jury's verdict under Dodd-Frank and Sarbanes-Oxley, the court upheld the award of millions of dollars of damages under California law.

Public companies also sometimes find themselves facing shareholder class actions after they resolve FCPA enforcement actions. In one such case, a federal judge in the Eastern District of Kentucky on April 30, 2019 granted a motion to dismiss securities fraud claims brought against General Cable Corporation (GC) and two executives after the company settled FCPA charges with the DOJ and SEC. The plaintiff had alleged that the defendants made false and misleading statements about GC's compliance program, the risks GC faced in overseas markets, and the effectiveness of GC's internal accounting controls. In dismissing the complaint, the court concluded that GC's statement regarding its compliance program was not actionable since it made no assurances that the system was effective and merely stated that it had a program, which was not false or misleading. The court disagreed with plaintiff's allegation that GC should have disclosed that its overseas operations would fail if it could not rely on corrupt business practices, finding that plaintiff alleged no facts that GC knew this was the case and thus did not have a duty to disclose this as a risk. Finally, the court ruled that plaintiff failed to adequately plead that GC actually knew that its statements about the efficacy of its internal accounting controls were false.

Additional information on the SEC's and DOJ's 2019 FCPA enforcement actions is provided below.


The SEC has announced the resolution of six FCPA enforcement actions against companies and two against individuals so far this year. On July 22, Microsoft (without admitting or denying the SEC's findings) consented to an administrative order settling FCPA charges for a total of nearly $16 million in connection with conduct of the company's subsidiaries in Hungary, Saudi Arabia, Thailand, and Turkey. On June 20, Walmart agreed to pay $144 million to settle the SEC's FCPA charges relating to the company's subsidiaries in Brazil, China, India, and Mexico. The SEC website lists and summarizes the following other FCPA enforcement actions in calendar year 2019 as quoted below:

  • Telefônica Brasil S.A. – SEC charged telecommunications company Telefônica Brasil with violating the accounting provisions of the FCPA when it sponsored the attendance of government officials at the World Cup and Confederations Cup. Telefônica Brasil agreed to pay a $4,125,000 penalty to settle the case. (5/9/19)
  • Fresenius Medical Care AG & Co. – the German-based provider of products and services for individuals with chronic kidney failure agreed to pay $231 million to the SEC and Department of Justice in a global settlement to resolve violations of the FCPA in multiple countries over the course of nearly a decade. (3/29/19)
  • Mobile TeleSystems PJSC – the Russian-based telecommunications provider agreed to pay $850 million in a global settlement to resolve violations of the FCPA to win business in Uzbekistan. (3/6/19)
  • CognizantThe New Jersey-based technology company agreed to pay $25 million to settle violations of the anti-bribery, internal accounting controls, and recordkeeping provisions. (2/15/19)
  • Gordon Coburn and Steven E. Schwartz – the former Cognizant officials were charged with authorizing $2.5 million in bribe payments to a government official in India. (2/15/19)


Enforcement Actions Against Companies

In calendar year 2019, the DOJ has announced five FCPA enforcement actions against companies, four of which involved parallel SEC actions. Here are links to the DOJ's press releases:

Declinations with Disgorgement

Pursuant to its FCPA Corporate Enforcement Policy, the DOJ announced that it was declining to prosecute Cognizant Technology Solutions.

Enforcement Actions Against Individuals

In a rare judicial decision involving the FCPA, on June 21, 2019, a federal judge in the Northern District of Illinois denied a motion to dismiss charges that Dmitry Firtash, a Ukrainian citizen, and Andras Knopp, a Hungarian citizen, conspired to violate the FCPA, among other federal criminal laws, in relation to a mining project in India. The court held that, even though these foreign defendants were not subject to liability under the substantive provisions of the FCPA for their conduct abroad because the indictment does not allege that they were agents of a domestic concern or committed a specified illegal act in the US, they nevertheless could face secondary liability for conspiring to violate, or for aiding and abetting, a substantive FCPA violation. The Illinois District Court expressly disagreed with the holding of the US Court of Appeals for the Second Circuit last year in United States v. Hoskins, 902 F.3d 69 (2018), setting up a potential circuit split if the case is affirmed on appeal by the Seventh Circuit. (For more on the Hoskins case, see our prior Advisory, Second Circuit Limits Government's Ability to Prosecute Foreign Nationals for Violations of the FCPA.) Following the district court's decision, on June 25, 2019, an Austrian court approved the extradition of Firtash to the United States.

Two Ecuadorian citizens living in Florida were charged in May with conspiracy to violate the FCPA, conspiracy to commit money laundering, and money laundering in connection with an alleged scheme to bribe officials at Ecuador's state oil company, PetroEcuador. At least four other defendants so far have pleaded guilty in this case.

Moreover, the DOJ has issued the following press releases with respect to developments in individual prosecutions relating to enforcement of the FCPA this year:


United Kingdom (UK)

  • On July 15, 2019, Basil Al Jarah, one of the four individuals charged as part of the Serious Fraud Office (SFO)'s corruption investigation into Unaoil, a Monaco-based oil and gas company, pleaded guilty to five counts of conspiracy to pay bribes in connection with contract awards in Iraq. The three other individuals charged in the investigation are scheduled to face trial beginning in January 2020.
  • On February 22, 2019, the SFO dropped its bribery investigations into drug company GlaxoSmithKline and individuals connected to Rolls-Royce.And on June 25, 2019, the SFO dropped its investigation into a trio of former Unaoil executives accused of paying multimillion-pound bribes for contracts in the energy industry. The SFO has since faced renewed criticism for closing corruption investigations.
  • On February 12, 2019, the Crime (Overseas Production Orders) Bill received Royal Assent to become law. This legislation will allow law enforcement agencies to accelerate the process by which they can obtain disclosure of electronic data stored outside the United Kingdom for use in UK criminal and regulatory investigations. However, before the law can be enforced, the UK Secretary of State must ratify corresponding international cooperation arrangements with foreign governments, and as of publication, no such agreements have been concluded.
  • On February 7, 2019, the SFO announced that David Lufkin, former Global Head of Sales for oil company Petrofac Limited (Petrofac), had pleaded guilty to 11 counts of bribery in violation of the UK Bribery Act 2010. According to his plea agreement, Lufkin offered bribes in order to influence contracts for Petrofac worth more than $730 million in Iraq and more than $3.5 billion in Saudi Arabia.

For additional analysis on recent anti-corruption, fraud, and bribery developments in the UK, please see Arnold & Porter's UK Economic Crime Group Update from June 2019.


  • On March 7, 2019, after the second-ever trial under Canada's Corruption of Foreign Public Officials Act (CFPOA), a Canadian court sentenced a UK and US national to 30 months of imprisonment over a failed plot to bribe India's Minister of Civil Aviation and Air India employees to secure a biometrics contract for US-based technology company Cryptometrics Inc. and its Canadian subsidiary.
  • On February 27, 2019, former Canadian Justice Minister Jody Wilson-Raybould alleged that Prime Minister Justin Trudeau and his top aides had pressured her to secure a deferred prosecution agreement for SNC-Lavalin, a multinational engineering and construction firm based in Quebec that is currently facing foreign bribery charges under the CFPOA. SNC-Lavalin, which has been accused of paying CAD 47.7 million in bribes to Libyan officials between 2001 and 2011 to secure lucrative contracts, and of defrauding the Libyan government of CAD 129.8 million over the same period, will stand trial on the corruption charges in September.


  • On January 31, 2019, a new law introducing anti-corruption amendments to the Italian Criminal Code entered into force. The new law targets corruption involving public agencies and introduces additional penalties on political parties for corruption-related crimes, new transparency and disclosure obligations in electoral processes, and the expansion of the definition of corruption-related crimes to include influence peddling.


  • On February 15, 2019, a Stockholm District Court acquitted three former executives of Telia Company AB (Telia) of bribery charges. The charges, filed in 2017, concern alleged bribery between 2007 and 2010 by an Uzbek local partner in connection with Telia's establishment in Uzbekistan. The court found that prosecutors had not proven that former Uzbek president Islam Karimov's daughter Gulnara Karimova, the purported recipient of the bribes, could be held liable even if she did receive such bribes.


  • On June 17, 2019, Brazilian construction conglomerate Odebrecht SA filed for bankruptcy protection to restructure $13 billion in debt in what would be one of Latin America's largest-ever in-court debt restructurings. The bankruptcy filing comes amidst a massive corruption scandal that has been described as the largest foreign bribery case in history. Odebrecht has admitted to paying bribes to politicians and senior officials in more than half of the countries in Latin America, as well as in Angola and Mozambique in Africa in exchange for government contracts. However, a new investigation led by the International Consortium of Investigative Journalists suggests that the bribery scandal is even more sprawling than the company has acknowledged. Recently leaked records from Odebrecht's Division of Structured Operations, a division created primarily to manage the company's large-scale bribes, reveal that the bribery extended to many more prominent public figures and massive public works projects than have been mentioned in the investigation to date. Investigations into Odebrecht's bribery of foreign officials are ongoing throughout Latin America.


  • On July 5, 2019, Mexican prosecutors issued arrest warrants for Emilio Lozoya, the former CEO of the state-owned oil and gas company Petroleos Mexicanos (Pemex), and five others on corruption charges linked to the Odebrecht scandal. These warrants are the latest in a series of high-profile investigations launched by the administration of President Andrés Manuel López Obrador in an effort to tackle corruption in Mexico. Lozoya is also wanted in another corruption case, along with Alonso Ancira, the CEO of Altos Hornos de Mexico (AHMSA), one of Mexico's largest multinational companies, on money laundering charges linked to AHMSA's nearly half a million-dollar sale of a defunct fertilizer plant to Pemex.


  • On June 20, 2019, former Interpol Chief Meng Hongwei, the first Chinese citizen to head the organization, pleaded guilty in a Chinese court to accepting $2 million in bribes in connection with the alleged misuse of his official positions in the Chinese government between 2005 and 2017 to give improper benefits to entities and individuals.


  • On January 28, 2019, Malaysian Prime Minister Mahathir Mohamad launched a five-year national anti-corruption plan which contains over 100 initiatives including new laws on political funding and lobbying, heightened regulation of the appointment process for top government positions, and an asset declaration system for lawmakers and ministers. The plan's announcement follows widespread public outrage over a multi-million-dollar corruption scandal involving former Malaysian Prime Minister Najib Razak, his wife, and several high-ranking officials of his former administration who face numerous criminal charges related to the theft of $4.5 billion from the state fund 1Malaysia Development Berhad (MDB).

*Dianne Lake, a student at Yale Law School, and Caroline Li, a student at Harvard Law School, contributed in the preparation of this newsletter.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions